TSCA and the regulation of renewable chemicals

In This Section

July August 2013

While regulators are generally supportive of new chemistries that can replace older, petroleum-based ones, biobased chemicals are subject to the same Toxic Substances Control Act (TSCA) that governs every other chemical substance in the United States.

Surprisingly, biobased chemicals that are considered to be “new chemicals” may actually receive more scrutiny under this law than established chemicals do.

The following article provides practical information about the TSCA provisions that are most relevant to biobased chemicals, regulatory outcomes of Premanufacture Notification (PMN) review, and strategies stakeholders can use to assure compliance and successful commercialization of biobased chemicals.

Biobased chemicals represent a multi-billion pound chemical business, and their share of the global chemical industry is expected to grow from 2% to 22% by 2025 [1]. Lux Research reports that biobased chemicals capacity will double in market potential to $19.7 billion in 2016 [2].

The enthusiasm that supports the commercialization of biobased chemicals in the United States has eclipsed a solid understanding of how the Toxic Substances Control Act (TSCA) applies to them. This article explains how TSCA relates to such products and suggests strategies stakeholders can use to ensure the successful marketing of biobased chemical products.

Biobased products include a broad spectrum, but for TSCA purposes, they can be placed into two broad groupings: biobased chemical products and biofuels. While biofuels may be a more prominent category of products derivative of renewable feedstocks (most notably corn and soybeans), biobased chemicals are the primary focus of this article as it is in this product area that TSCA has its greatest potential application.

TSCA overview and relevant provisions

TSCA is the federal law that governs new and existing chemical substances throughout their production, distribution, use, and disposal [3]. “Chemical substances” are defined broadly to include “any organic or inorganic substance of a particular molecular identity,” excluding pesticides, drugs, and food, which are regulated under other federal laws [4]. That biobased substances are derived from renewable feedstocks does not preclude TSCA’s application to them. We focus here on understanding the provisions critical to recognizing and appreciating how TSCA applies to biobased chemicals.

Three TSCA sections are especially relevant to this discussion: TSCA Section 2, Section 8, and Section 5. TSCA Section 2(b) outlines TSCA policy, and TSCA Sections 2(b)(1) and (2), respectively, discuss that test data need to be developed on the effects of chemicals and that adequate regulatory authority should exist to control chemicals presenting “unreasonable risks” to health and the environment. Section 2(b)(3) clarifies that this authority should be exercised so as not to impede or create “unnecessary economic barriers to technological innovation.” TSCA Section 2(c) states that it is Congress’ intent that the US Environmental Protection Agency (EPA) “consider the environmental, economic, and social impact” of any actions taken. Read in combination, TSCA Sections 2(b) and 2(c) confirm that in taking action to control unreasonable risks, EPA is to consider and balance the risks, costs, and benefits presented.

TSCA Section 8(b)(1) directs EPA to compile and maintain the TSCA Chemical Substance Inventory of each chemical substance that is domestically manufactured or imported into the United States. The initial Inventory was created in 1978–1979 when chemicals were listed on the Inventory automatically, avoiding EPA review of them when listed. New substances are added to the TSCA Inventory through a process that involves submission of a Premanufacture Notification (PMN), which typically accounts for 1,000 to 2,000 new chemical substances each year. EPA reviews the new chemical, imposes any needed regulatory requirements, and adds it to the Inventory once a notice to EPA by the notifier has been filed confirming that manufacture has commenced.

Given that the TSCA Inventory was initiated in the late 1970s, the organic chemicals listed are reflective of the commercial chemistry of that time, which was largely petroleum based. While biobased chemicals were present on the original TSCA Inventory, their number and variety were limited in comparison to petroleum-based substances, with the result that many biobased chemicals will be considered “new chemicals” subject to TSCA Section 5 notification.

It is important for biobased chemical manufacturers and their downstream customers to understand the regulatory implications of the TSCA status of their biobased chemicals. Manufacturers (including importers) of chemical substances considered “new” must notify EPA of the chemical substance through the submission of a PMN. Unless a PMN exemption applies, a company must submit a completed PMN form to EPA at least 90 days before commencing the manufacture of a new chemical substance. The EPA review process by statute takes no less than 90 days but can take considerably longer.

Under TSCA Section 5, EPA assesses the PMN to determine if a new chemical presents potential “unreasonable risks.” TSCA Section 5(d)(1) requires that certain information be provided in the notice, including a description of the chemical, estimated annual production volume, intended uses, worker exposure information, and any test data in the possession of the notifier on health and environmental effects, among others. Information provided in the optional “Pollution Prevention” section (e.g., information on expected net benefits such as reductions in risk or releases associated with the new chemical, energy or product efficiency, use of less toxic intermediates, and related factors) is also requested.

Regulatory outcomes of PMN review

If EPA’s review reveals risk concerns with a new chemical, TSCA Section 5(e) authorizes EPA to issue consent orders allowing the manufacturer to market the chemical only in conformance with certain enforceable conditions [5]. EPA has discretion to limit the manufacture, processing, distribution, use, or disposal of the chemical to address the concerns EPA’s review has revealed. Once the chemical is commercialized subject to a consent order, the notifier is legally required to observe the terms and conditions in the consent order.

The moment the chemical has been placed on the TSCA Inventory, it is no longer considered “new” and other manufacturers of the same chemical may manufacture the chemical without submitting a PMN. TSCA Section 5(a)(2) authorizes EPA to require notifications on “significant new uses” of existing chemicals. In promulgating a Significant New Use Rule (SNUR), EPA is required to consider “all relevant factors,” including, for example, the projected volume and the extent to which a new use increases the magnitude or changes the type of exposure.

To avoid the competitive imbalance that would otherwise ensue if follow-on manufacturers were free to manufacture and use the chemical without the commercial restrictions imposed on the original PMN submitter under the TSCA Section 5(e) consent order, EPA can issue a SNUR imposing the consent order’s requirements on subsequent chemical manufacturers. These are known as “Section 5(e) SNURs.” For other substances, EPA may determine that although the manufacture, processing, and/or use of the chemical substance as described in a PMN does not present health and/or environmental risks requiring EPA action, there are other potential uses not described by the PMN submitter that EPA determines represent “significant new uses” such that a SNUR is needed. EPA can use its SNUR authority to regulate such potential uses, and these are referred to as “non-5(e) SNURs” to reflect that no Section 5(e) consent order was issued to the original PMN submitter.

Points to consider in commercializing biobased new chemicals

Whether a biobased chemical is new or existing is a question that needs to be known well in advance of any plans for commercial activities. If an Inventory listing for the chemical(s) can be established, the PMN hurdle as a new chemical can be avoided. If one or more of the chemicals is subject to TSCA new chemical notification, this point needs to be recognized and addressed early. When EPA targets a chemical for regulation, this will result in unplanned delays, potentially lasting for months to years, resulting in a barrier to commercialization.

Given the origins of the Inventory with its prevalence of petroleum-based substances, a number of anomalous situations arise. Whereas EPA is generally supportive of new chemistries that can replace older, petroleum-based chemistries, biobased chemicals will continue to be the subject of regulatory scrutiny by EPA as “new” chemicals. This can lead to a disproportionate amount of regulatory scrutiny at the point of commercial introduction when these new, presumptively greener chemicals are attempting to break into the market and compete with established nonrenewable chemicals that, as Inventory-listed substances, escape such regulatory scrutiny under TSCA.

Emphasizing the benefits of a biobased new chemical is important. The PMN form includes a section entitled “Optional Pollution Prevention Information.” This section should be used to discuss the benefits of a biobased new chemical. In developing the points to include, it may be helpful to think of the task as one of essentially “making the case” for a new biobased chemical introduction and including points establishing: renewable sourcing; pollution prevention or risk reduction benefits (these could include reduced pollution, reduced agricultural waste, use of safer processes or products, avoidance of toxic intermediates, reduced or less toxic waste generation, energy efficiency, relatively safer or less polluting than competing existing chemicals, and related considerations); and cost or performance benefits (these could include improved product performance; lower costs; more energy efficient production, processing, or use; and related factors).

How to approach your biobased PMN chemical to help ensure success

Ensure TSCA Compliance Is a Core Element of the Business Plan. Know the TSCA requirements, understand the regulatory responsibilities, and be prepared to meet both the requirements and the responsibilities as a part of a business development plan for the biobased chemical.

Understand the Relevance of Chemical Nomenclature and Naming Conventions. Recognize and understand the importance of how a chemical is named and identified and how that can affect new chemical responsibilities. It is important to understand the relevance of chemical nomenclature and naming conventions to the manufacturing process.

Know the TSCA Review Process. A basic understanding of EPA’s review process and regulatory approach is essential. Although EPA works from the information included in the PMN, it also considers information on other “related” cases, applies structural activity relationship analysis when hazard test data are not available, and will use assumptions about likely exposures and releases if information is not provided in the PMN.

Consider Testing in Advance of PMN Notification. If EPA is likely to impose testing requirements on a biobased new chemical, consider the benefits of either doing the testing in advance of the notification or, if future commercialization plans involve additional structurally similar new chemicals, whether it might make sense to develop a testing strategy that would encompass and account for the range of new chemicals likely to be introduced. If other firms are known to be active in this area of new chemical development, there might be significant cost saving and advocacy opportunities for organizing consortia to share the costs and responsibility of testing.

Work with EPA. Regardless of the approach taken, it is always wise to consult with EPA before embarking on chemical-specific testing or developing and implementing a testing strategy to ensure an understanding of EPA’s views on and obtain its receptivity to the approach proposed.

Advocate, Advocate, Advocate. As a final thought, advocate the benefits of a biobased new chemical. This should involve careful preparation of the points that can be made on the optional Pollution Prevention section of the PMN notice. Beyond that, there may be value in recognizing and advocating the bigger-picture policy benefits of biobased chemicals to ensure that the EPA new chemical reviewers are aware of and appropriately consider and value those aspects. While EPA at the higher management levels is likely aware of US government policy drivers (such as the recently announced National Bioeconomy Blueprint [6]), this awareness may or may not have reached the scientists and other career EPA staff levels actually reviewing PMN notifications. As with testing, while individual companies can and should emphasize relevant policy drivers in their interactions with EPA’s new chemical reviewers, there may also be considerable value in and a role for consortia to press these points with EPA.

Lynn L. Bergeson is the managing partner of Bergeson & Campbell, P.C., a Washington, DC law firm focusing on conventional, nano, and biobased chemical, pesticide, and other specialty chemical product approval and regulation, environmental, health, and safety law, chemical product litigation, and associated business issues. She is also president of The Acta Group, with offices in the United States, United Kingdom, and China.

Charles M. Auer is the president of Charles Auer & Associates, LLC and is an affiliate with Bergeson & Campbell, P.C. Mr. Auer retired in January 2009 as the director of the EPA Office of Pollution Prevention and Toxics where he was responsible for chemical assessment and management issues under TSCA, pollution prevention and Design for the Environment under the Pollution Prevention Act, and a broad portfolio of international responsibilities (with, for example, the European Union under REACH [Registration, Evaluation, Authorization and registration of Chemical substances], Canada under the Canadian Environmental Protection Act [CEPA], and intergovernmental organizations [Stockholm and Rotterdam Conventions, Strategic Approach to International Chemicals Management, Organisation for Economic Co-operation and Development, etc.]). Over his 32 year career at EPA, he gained broad and deep experience in chemical notification, assessment, and management issues as a senior executive, mid-level manager, and technical assessor.

R. David Peveler is a Ph.D. organic chemist with Bergeson & Campbell, P.C. His areas of expertise include domestic and Canadian product regulatory compliance, Federal Food, Drug, and Cosmetic Act food contact and packaging matters, Federal Insecticide, Fungicide and Rodenticide Act product registration and labeling matters, Department of Transportation classification and labeling issues, and product safety (Occupational Safety and Health Administration and Workplace Hazardous Materials Information System–compliant Material Safety Data Sheets MSDSs and labels). The views expressed in this article are entirely those of the authors.